Fears of global recession outweigh concerns of reduced output by OPEC

New York's main contract, light sweet crude for December delivery, dipped by over 3 dollars to US$64 a barrel, while Brent North Sea crude for December delivery fell to $US62 per barrel. In intraday trade; the New York futures contract ebbed to $US62.65 and Brent to $US61.00, their lowest levels since May 2007. A robust cut in production by OPEC of 1.5 mln bpd, has failed to influence demand and lift oil prices. This could be attributed to growing fears of a global economic recession that has amplified concerns of declining energy demand. In an attempt to stabilise deteriorating oil prices as global economy seems poised for global recession, OPEC's production cut will come into effect on November 1. Oil prices weakened in Asian trade as OPEC's decision to cut supply at a time of global financial turmoil is considered to further impair already weak energy demand. OPEC number two producer - Iran, is reported to have said that the cartel is likely to cut back further on production if the latest reduction does not stabilise crude prices. OPEC's decision to slash output would be reviewed at it's next meeting in Oran, Algeria, on December 17.